Thursday, January 6, 2005 Sam Adams plans $6.7M brewery expansion
By John Eckberg Enquirer staff writer
WEST END - Cincinnati may no longer be a national center for brewing but after the Boston Brewing Co. pumps $6.7 million into its plant here, the Queen City will become a flagship facility for the acclaimed craft beer maker.
Based in Boston but with roots in Cincinnati, the company that produces Sam Adams Boston Lager and 19 other varieties of beer plans to boost output at its Central Parkway brewery from 600,000 barrels to 800,000 barrels a year.
"That will be two-thirds of our company's production," said Boston resident and Cincinnati native Jim Koch, who founded the Boston Beer Co. in 1984 with a batch brewed in his kitchen.
The beer was based on a 19th Century family recipe from his great-great-grandfather stored in his father's attic. He named the brew for the Boston firebrand because he was "a revolutionary thinker who fought for independence" - and because Adams was a brewer who inherited the tradition from his father, according to the company's Web site.
Koch, a sixth generation brewmaster in his family and a former graduate of Indian Hill High School, told a room of politicians and others, including his high school history teacher, Jim Powers, that the former Schoenling Brewing Co. plant was a perfect place to brew great beer.
The company has already achieved worldwide acclaim with more than 500 international awards. About 100 people work at the brewery, which was purchased by Samuel Adams in 1996.
When the expansion is completed in September, the payroll will grow by another 10 positions, company officials said.
Mayor Charles Luken, who jokingly acknowledged that his family has had a long and joyful association with beer - a grandfather and uncle were beer salesmen - thanked Koch for investing in his hometown.
"This brings back a lot of memories for a lot of people of Cincinnati's other breweries: Hudepohl, Schoenling, Weidemann," Luken said.
Koch, whose beer career began by selling Sam Adams to bars in Boston from the back of his yellow K-car station wagon in the early 1980s, later offered a toast of celebration.
Koch did not become a brewer in the traditional way. He left Cincinnati to go to college in Cambridge, Mass., where he received a bachelor's degree in history, a master's degree in business administration and a law degree from Harvard University.
Koch, who is officially the brewmaster and chairman of Boston Brewing, soon turned his back on a high-flying consulting career - "I worked with Jack Welch of General Electric before Welch became famous - to fulfill his craft beer dream.
"My father had apprenticed as a brewmaster at this plant," Koch said. "He thought I was crazy when I told him what I was going to do."
In 1948, there were 1,100 breweries and brewmasters in the United States, Koch said. By the early 1980s when Koch created his company, only 40 were left.
Today, Koch said, three brewers account for 95 percent of the beer produced in the United States.
Even with projected production of 800,000 barrels of beer, the plant volume pales in comparison to the output of major brewers such as the Miller Brewing Co. brewery near Trenton in Butler County
"Budweiser probably spills more beer each year than we produce," Koch said.
Cincinnati council member Jim Tarbell said that in the 1880s, the glory days for Cincinnati beer, 155 breweries were here. Today, the Boston Beer Co. is the last big one left in the city.
The investment will bring the plant 24 lagering and aging tanks and new brewhouse equipment.
Boston Beer Co. revenues grew from $186.7 million in 2001 to $208 million in 2003, the last full year that figures were available.
"People in general are drinking less but they want to drink quality," said Al Vontz, co-chairman of Heidelberg Distributing Co., the sister company to local Sam Adams distributor Ohio Valley Beer and Wine.
While the projected job growth is not tremendous, the investment is symbolic on other levels, said Cincinnati council member David Pepper.
"It's one thing to bring in new business to a city," Pepper said. "But it's vital is to expand businesses that are already here. That's why this is so important."
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